- – Are you struggling to raise deposit to get a mortgage?
- – Are you tired of paying ‘dead rent’?
- – Do you want to build up equity in your home even before you get a mortgage?
- – Do you want to be free to use your DIY skills to upgrade your home to your taste?
- – Are you having problems getting credit and need time to improve your credit rating?
- – Can you afford to pay rent monthly but can’t get a mortgage?
sMighty Home corporate mission is to help tenants own their homes, so if you answered “yes” to any of the above question, then you might benefit from our Assisted Home Ownership scheme.
The scheme is based on the Rent-To-Own model of home ownership used in Australia and America.
It is not a shared ownership scheme, rather it gives tenants the opportunity of full ownership at an agreed period, which is usually after four years.
Our Rent-To-Buy scheme is similar to buying a car on lease. You make monthly rent payments as and when due and at the end of the agreed term you get a mortgage to complete the purchase or walk away from it without any penalty, if that is what you want.
Rent-To-Own homes are like gold dust. You need to register early for a chance to rent one of them because we offer them to tenant-buyers on ‘first come, first served’ basis.
You can move in fast!
We like to keep things simple, so the whole process has been designed to be quick and easy. You can settle into your new home within days, not months!
After viewing one of our Rent-To-Own homes and you decide to rent it, you will be required to fill an application form and pay £350 Holding Deposit to reserve the property. The Holding Fee forms part of your first rent.
Once we receive satisfactory references, you will be required to pay the balance of your first month rent and £750 down payment to move into your new home.
After moving in, you will have to pay the balance of £750, to make up the £1,500 down payment before you get the legal ‘tenant-buyer’ document that gives you the option to buy your home at the agreed terms. Without the legal tenant-buyer document you are an ordinary tenant with no right to buy your home.
Down payment covers the cost of sourcing your home and fixing the rent and purchase price for up to four years. Down payment goes 100% towards the purchase price of your home and it is non refundable.
Please Note: (1) The down payment is not a security deposit. It is a non refundable payment that goes towards the purchase of your home, i.e. it is credited 100% towards the purchase price of your home.
Just as down payment made to exchange contract with a seller in traditional home purchase is non refundable, in the same way down payment is non-refundable in a rent to buy home purchase.
If you can’t or decide not to complete on buying your home, you are free to sell your right to buy it and you could make profit if your home has appreciated in the value, otherwise you will lose the down payment paid.
(2) Agreement to rent and buy your home are drawn by property lawyer, so after you move in, you will need a lawyer to represent you before you sign the documents that give you the option to buy the flat.
While you are on the scheme, the rent and the price of your property are fixed for up to 4 years. This period is long enough to enable you build up deposit and equity in your home to reduce the amount of mortgage you will need to complete the purchase.
Agreed fixed monthly payments!
Monthly payment is fixed, so tenants are protected from rent increase for up to 48 months.
The agreed purchase price won’t be increased!
The purchase price of your home is agreed at the start of the scheme and won’t go up even when property prices do. Once you move into your new home, you can improve and decorate it to your taste, making it the home you’ve always wanted.
If property value goes down!
We might be able to extend the scheme period until the value increases again or you can walk away from the property without any penalty or fees.
Time to iron out wrinkles in your credit!
There are lots of reasons why people have poor credit record. The sad thing is it might not be their fault, but it can stop them from getting a mortgage or the best deals available. With our assisted home ownership scheme, you have the time to improve your credit rating if you need to and build up equity in your home at the same time.
It doesn’t require credit scoring!
However, in order to verify tenants’ identity and ability to make monthly payment, we will use the services of an independent referencing company to do credit check and obtain satisfactory references from employers, previous or current landlords.
100% Ownership on completion!
Our scheme is not shared ownership, rather we assist you to build up equity over a period of three to four years using the rent-to-buy model of home ownership that is common in Australia and America.
Assisted Home Ownership Schemes available:
We have three schemes to assist first time buyers get on the property ladder and existing home owners move to their dream homes.
These schemes are suitable for home buyers who:
1. Don’t have 5% or 10% deposit to secure a mortgage.
2. Are self-employed and finding it difficult to prove enough income to get a mortgage.
3. Have recently changed jobs and can’t get a mortgage yet.
4. Are legal immigrants but have not been in the country long enough to qualify for a mortgage.
5. Need time to improve their credit history before they can get a mortgage.
Before you decide to apply for any of our Assisted Home Ownership scheme, you need to ask yourself a few questions:
1. Do you plan on staying in the area for a foreseeable future?
After viewing a property and your application to buy the property is successful, you will be required to pay £350 Holding Fee, which will form part of your first month rent.
You will also make a down payment of minimum of 1% of the purchase price or £1,500 (whichever is higher and depending on the scheme you choose).
The down payment is non-refundable and goes towards the purchase of your home. i.e. it is 100% credited to reduce the purchase price.
It is not a security deposit, so you don’t get the down payment back if you decide not to purchase your home. You are free to walk away if you choose to, but you will lose the down payment.
It is similar to what happens in a traditional home purchase, where you will lose your 10% deposit plus costs if you decide not to buy a house after you have exchanged contracts.
The down payment covers the cost of sourcing your home and fixing the purchase price and rent for the duration of your Assisted Home Ownership scheme.
So you need to think carefully and be sure you are ready for home ownership before you apply for membership of our Assisted Home Ownership Scheme.
2. Will you be able to secure a mortgage at the end of the scheme?
We recommend that you get pre-qualified for a mortgage before you sign up for any of our scheme.
This is to make sure that you are not getting into a contract to purchase a home that you could not possibly qualify to get a mortgage to buy in future.
Pre-qualification process can give you an idea of what you should expect when you seek a loan, however, it’s no guarantee that you’ll be approved on the same terms when you are ready to buy your home.
We can link you with fully qualified mortgage brokers who are able to offer you information and advice about the most suitable mortgage solutions selected from hundreds of competitive lender schemes.
If you’re using our home ownership scheme because you need to improve your credit profile, you may be able to get a better rate at the end of the scheme than you would have been able to get at the beginning, if you don’t default on any credit obligations you have.
In some cases, we might be able to extend the scheme period if you need more time to be able to get a mortgage. (However, this may be subject to price and rent review)
Please note, you don’t get the down payment back if you can’t get a mortgage to buy your home. You can either sell your right to buy the house or decide to walk away from your home.
3. Can you afford the monthly payment?
Monthly payment under the scheme costs more than you would pay if you were simply renting the same house, so you should be reasonably certain that you can afford the monthly payment as well as meet other expenses of home ownership like insurance, council tax, utility bills etc .
Our Assisted Home Ownership has an in-built incentive for tenants known as ‘Monthly Credit’.
Tenants earn 10% Monthly Credit every month they pay their rent in full and on time. Monthly Credit helps tenant build up equity and reduce the amount of mortgage they need to complete on the purchase of their home.
Please note: If you do not or cannot complete on the purchase of your home before the expiration of the four year scheme, you need to sell your right to buy your home before the end of the 4 years or you will lose your down payment and any accrued monthly credit.
Rent to buy homes are like gold dust, register today for a Rent to Buy Home!